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RECOVERIES FROM THIRD PARTIES 

These need to be considered early because: 
  • Larger deductibles make owners uninsured for a considerable prortion of their loses.
  • Their loss mat covered by their own insurance conditions.
  • Insurers, due to recent heavy losses, are much more interested in recoveries from third parties.
  • Credit for recoveries to underwriters improves an owner’s overall claims record.

Type of Casualties Involved

These include:
  • Negligence of repairers.
  • Negligence of Charterers (e.g. supplying poor quality bunkers or instructing the vessel to use an unsafe berth).
  • Supply of defective equipment by manufacturers and suppliers.
  • Damages caused by stevedores.
  • Negligence of port Authorities.
  • Negligence of tugs and pilots.

Initial Action to be Taken

Master or Chief Engineer must immediately note protest against the third party in writing.
Where possible they should also obtain written acknowledgement of receipt. This action will:
  • Satisfy any contractual requirement for prompt notification to be given to the contractor in the event of a dispute arising.
  • Formally notify the third party of a potential claim so that he can advise his Liability Insurers as appropriate.

Communication with third parties 

Discretion has to be exercised when dealing with the third party or their representive in order to avoid prejudicing any further recovery action.
 
Avoid discussion of the incident in detail and restrict any necessary exchanges to the irrefutable facts concerning the incident.
 
Surveys

Prior to any repairs being undertaken, the third party should be given the opportunity to inspect the damage in conjunction with the Ship owners’ representative

Documentation

It is impossible to state exactly which documents will be required in each instance but they would usually include all those required for presentation to Hull Underwriters together with the following:

  • Master’s/Chief Engineer’s Report, Note of Protest and/or letter holding Third party liable together with acknowledgement of receipt.   
  • Copy of any contractual conditions that were applicable;           
  • Ship repairers’ terms and conditions  
  • Towage conditions
  • Pilotage conditions
  • Charter party terms
  • Manufacturers’ guarantee
  • Witness statements.
  • Copies of any exchange of correspondence with the third party.

Extent of Claim
 
A claim against a third party is not restricted to the Shipowners’ insured losses but can include losses that were not insured.

These could include:
  • Loss of Hire
  • Costs of Overtime
  • Loss of Earnings(i.e. freight/hire)
  • Temporary Repairs

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